We agree 100%.
Back before we entered the publishing business we shared an opinion similar to @TomSawyer. The thought was if not for an anime/manga series being available for free through unlicensed and illegal means, then there is no way for it to build a following. "It may be piracy but its free exposure" is what we told ourselves, that we as "fans" can illegally spread this series and it will become super popular and then the creators will somehow be compensated.
The reality is this is very pie in the sky and a fallacy that consumers of pirated material tell themselves to placate their sense of morality (stealing is wrong). In a perfect world maybe this would work, however, the number of legitimate fans who will support a series after it is available for sale (after having previously enjoyed for free) is a tiny fraction. By our estimates this number is around 2.0 to 2.5%.
Such a low number is seen widely across the Free-To-Play/"freemium" online games where it is completely legal to pay $0 forever. Reports show that the number of players who support the free-to-games they spend time on is between <1% to 2.2%.
Closer to home, here on Tapastic, the numbers are similar. For example, 4 Panel Life, which is free to legally read and has 40,000 subscribers, was only able to attract roughly 1,000 supporters (or 2.5%) on Kickstarter to purchase print copies.
- Bottom line, fans who purchase after reading the scanslations for
free is the rare exception, not the rule.
For those unaware, publishing is a high risk venture with razor thin margins. You may think $13 is a lot to pay for a single volume, but remember, stores that sell those books (even non physical stores like Amazon) get 50-60% off the cover so they can make a profit and keep the lights on. So suddenly a publisher is looking at $5.20/unit of gross revenue off that book you just bought. Then if it costs $2/unit to print, now there is only $3.20/unit left to pay the artist/studio, the editor, the translator, the publicist, the warehouse, the freight, the advertising, etc. The net profit gets really small, really fast. Furthermore it can easily cost upwards of $80,000 in development expenses to get new series off the ground.
So assuming $1/unit margin on a series and a 2.5% support level, it would take 3,200,000 scanlation readers for the series to just break even. O.O
Dare we say more?
While wages are rising ($15.00/hour minimum in CA in 2021), the prices for books have remained relatively flat. Readers can afford books but choose not to purchase. This ultimately forces publishers to focus on proven series (Marvel/DC superheros) and proven artists and less willing to take on new creators and new series that may end up being big financial sinkholes.
Consequently as long as readers remain fixated on "free" and choose not to support creators, they will see fewer new series, fewer new creators, and less variety as everyone focuses on the stuff that sells and doesn't risk trying out a new idea.
- Bottom line, creators can't create forever for free.